I have been traveling the world as a journalist and passionate lover of all things fun for 20 years. I have had weekly columns in USA Today and Investors Business Daily, published thousands of articles in leading magazines from Playboy to Popular Science, and am the author of Getting Into Guinness. I am the Contributing Travel Editor for Cigar Aficionado Magazine, the restaurant columnist for USAToday.com, and am a co-founder of TheAPosition.com, the leading golf travel website. I love every kind of travel, active, cultural and leisurely, and my special areas of expertise are luxury hotels and resorts, golf, skiing, food, wine and spirits. I tweet @TravelFoodGuy

Kobe Beef Scam, Part 3: Why The U.S. Government Wants You To Buy Fake Foods

This is a glass of tawny port. Buy it in any European Union nation, and you know by law that it comes from Portugal and is made under strict quality rules that have been in place for centuries. Buy it in the U.S. and it can come from any state or country or in the world, with no assurance of quality whatsoever.

For the past two days I have examined in (sometimes excruciating) detail the facts behind the various products sold in this country as Kobe beef and Japanese Kobe beef (Part 1), and domestic or American-style Kobe, Wagyu, and domestic, American-style, or Australian Wagyu (Part 2).

After this examination, my conclusion is that these products are collectively an attempt to fool the American consumer into thinking they are buying something they are not, at very high prices, by trading on the longstanding reputation of excellence belonging to the cattle producers around Kobe, Japan, whose meat is never, ever sold on our shores.

But Kobe is just the tip of the labeling iceberg – there are literally hundreds of other food items, from the extravagant, such as Champagne and Cognac, to the more common, like Parmigiano-Reggiano cheese, whose production and sale in this country would violate many very old and well-known foreign trademarks – except that these trademarks are not recognized by U.S. law. Like Faux-be beef, this domestic production is undertaken mainly for one reason – to reap the benefit of good will and quality brand reputation created by someone else, namely foreigners who have no recourse in U.S. courts.

And for that we can thank the U.S. government.

After all, while I think the whole American Kobe thing is morally suspect, it is only to be expected that any commercial activity that is not explicitly against the law and can be profited from will be profited from, regardless of right or wrong. I guess I can’t blame the marketers behind these schemes for their innate human nature. But I can blame the government.

This is not an oversight, as in, “hey, we forgot to regulate the labeling of Kobe beef.” This is part of a pattern of deliberate actions going back well over a century on the part of the Federal government to actively ignore foreign trademarks and intellectual property claims in order to support domestic industries. It has very much been done on purpose, and continues to be done on purpose, at the expense of the American consumer (and foreign producers). It is also stunningly hypocritical, and flies directly in the face of the government’s deep pocketed attempts to combat piracy in the arenas of music, film, technology, and software. I think that if we were not the ones who had basically pioneered the computer and software industries, and were not home to Hollywood, and these businesses were based in other countries, we would gleefully produce our own “domestic” versions of foreign software, technology and entertainment without recompense to the countries that had invented and trademarked them.

2014 UPDATE: Changes have occurred regarding the status of Kobe beef in the United States. For the most current information, please read the 2014 piece, The New Truth About Kobe Beef, which has details that supersede information contain herein.

This is the final entry in this series. Since I went on at great length in Part 1 & Part 2, I am going to be more concise today and give only a brief history of the U.S. Government’s intentional piracy approach to foreign foods and drinks:

The Treaty of Madrid in 1891 was among the first major international agreements on the protection of geographically designated food production. These are known today variously as Geographic Indications (GIs), the term collectively favored by the European Union, or by various national terms of geographically protected Designations of Origin (PDO, AOC, DOC, DOCG, etc.). In each case they refer to products so associated with production in a particular place as to warrant protection of that place/product combination. Usually the rationale is a combination of history, manufacturing tradition, terroir, and local law. The product typically grows or is made there better for environmental reasons, like the famously chalky terrain of Champagne or the volcanic soil in which legendary San Marzano tomatoes grow. In many cases the product also has been made there under very specific and unfaltering rules of purity, with strict supervision, sometimes for centuries. As a result, when you as the consumer buys that item, you should know exactly the level of quality and purity you are getting, be it Georgia peaches, Florida orange juice, Champagne or Kobe beef.

Parmigiano-Reggiano cheese is perhaps the most perfect example. It has been made in one area (neighboring towns of Parma and Reggio Emilia, hence its name), under strict rules, for more than 700 years. Every step of production, from the type of cows used for milk to where they can graze to what they can (wildflowers) and cannot eat (hormones, antibiotics) is regulated. So is the number of hours that can elapse from when the cows are milked until that milk is used to make cheese. Nothing but milk, whey, salt and rennet is allowed. Every wheel of cheese must be of uniform size and minimum age and be aged in the same area in the same fashion.

There may be no food product in the world more tightly regulated in its production, and furthermore, every single wheel is tested by a governing organization, with many wheels rejected. As a result, there is literally no such thing as bad Parmigiano-Reggiano cheese. If you buy the real thing, you are guaranteed a cheese of such exceedingly high quality it is known in the dairy world as the “King of Cheeses.” Wheels are so valuable they are affixed with holograms and their rinds engraved to protect against counterfeiting. Unfortunately, many Americans have never had the real thing, because while it is readily available here, fake Parmigiano-Reggiano costs less and is the norm on our shores. I examine this issue, The Dark Side of Parmesan, in a seperate story.

Twelve decades ago, the highest profile of the many foodstuffs to come out of the Treaty of Madrid protected was Champagne. Every major power in the world at the time elected to sign the treaty, with the exception of the United States. As a result, the term “Champagne” has been protected in almost every other first-world country since 1891. The Treaty has been revised many times, and in every case since, the U.S. has adamantly refused to sign. This is not an issue forgotten by the rest of the world. The European Union alone has a list of over 600 geographically designated products it protects under law, almost none of which the US agrees with. Despite repeated requests dating back more than a century from the French, and in recent decades the World Trade Organization and European Union, the U.S. has stubbornly and purposefully refused to become party to this treaty or dozens of others like it.

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This is an unfair practice, both to American consumers and to producers of the true product overseas. It does seem to be a trend in the U.S. that the agencies who should be overlooking these types of problems either actively distort origins (as you have discussed here) or look the other way when they should be enforcing laws they actually have on the books.

The most frustrating example I have encountered recently was trying to find real varietal honey. We don’t even enforce laws about purity and verification of origins with the grocery store stuff, so you’re not going to have any luck unless you actually know somebody with some bees (and trust them). In that case we even have existing laws, but they’re just for show.

Thank you for bringing this issue to the public. It seems that we can’t rely on any government agency to guarantee truth in our food products, but at least with the speed of internet news and social media we have more awareness lately. Pink slime and kobe beef are just the beginning, I am sure there is a lot more out there that the public would like to know about what they are eating.

Sounds like a damned if you do and damned if you don’t scenario. America is trying to protect its domestic industries, but at the cost of the American people. So what’s it going to be? Do you want to affect American industries to benefit consumers or not?

I think America should take a stand against the import or even sales of produce made from endangered or protected species, however, there are still loads of sales of sharkfin soup and other similar asian delicacies. Not sure if they are allocating the proper protectionism to the right places.

Steve, I’m with you on the sharkfin soup, et al. And job-wise, I’d like to note that since Japanese beef is banned for health reasons, not trade reasons, requiring producers here to label accurately wouldn’t cost a single job – as log as they beef they are then sellgin correctly labelled is of high enough quality to warrant consumers buying it without being duped. Additionally, we are a huge exporter of beef ot Japan, far more than we ever considered importing. Thanks for reading!

There are so many wonderful produces that are native to U.S.A. that I think that there is no reason to rip off foreign products. A good example is Maine lobster.

Unfortunately many of those are not appriciated by U.S. citizens. Take for example geoduck, one of the biggest clams there is, lives in nw U.S. & Canada and harvested there. But most of it goes to export when U.S. citizen doesn’t realise what they have.

Here is my problem with the wording of the story: the “US Government” didn’t wake up one day and decide it would be good for the country to allow domestic manufacturers to counterfeit foreign brands. There wasn’t even a senator or congressman who had the wherewithal to initially orchestrate this. US food manufacturers lobbied the US government, got their people elected, and had them push through these laws. The industry’s big players paid a lot of money to make sure they could do this. They continue to pay big money to make sure things don’t change, and if they do change they will be “grandfathered” in, which is the best of all possible worlds because then they can never have a new competitor.

The government is a tool. It rarely does anything without someone powerful asking for it. The real villainy here starts right back at the US manufacturers who make so much profit from the piracy in the first place. Turning the focus towards the “US Government” is very much a distraction from the real problem.

Except of course, the only way to stop corporations from doing that is for the government to regulate them. And that leads to a Catch 22 sort of situation unless we are willing to consider some outside influences — like informed, open-minded, non-polarized, non-ideological citizens. But I make myself laugh here. That’ll never happen!

I suspect in the beginning it wasn’t a conspiracy. A French family emigrates from the Champagne region and starts a vineyard. Since they didn’t change how they made it, they called it champagne. Of course now it’s all about marketing and manipulating the buyers. :/

You should really reply to Thane. The accusation that “the government” wants this result is the same kind of deceptive marketing you are accusing the food retailers of. You know readers of Forbes are hungry for anti-government rhetoric so you completely sidestep the question of why legislators for 120 years have backed these policies. Who benefits from such laws/and regulations (or if we tried to change them who would oppose it?) Thane provided an answer, but you did not, despite the headline (label).

Joe, Wow! I’ve gotten a lot of surprising comments over the years but I think this is the first time anyone ever wrote in telling me who I should not reply to. But okay, here I go for you and Thane – sure lobbyists and business interests heavily influence government policies, and this may well be the main reason behind this historically protectionist practice. But that does not make it okay, nor does it mean the govenrment cannot be pressured to change. As fun as it is to go on anti-government rants, our leaders sometimes actually act in the best interests of the citizens at the expense of “big business.” They could do so in this case. And these practices predate any modern notions we have of lobbying or corporate influence, and have stood fir through coutnless changes of administration and control of the legislature. I do believe these policies reflect an ingrained philosophy of the American government to resist being told what to do by other countries. However, I know a lot more about what the goverment has and has not done in this regard historically than why they made those decisions, one reason why I don’t want to go down this road as a splinter topic to the story. Also, I think reflexively it is easy to see this as a “big government” vs “Small government” or more regulation vs less regulation philisophical dive but I don’t see it that way. I see it is fair regualtion vs unfair. Many government agencies are spending large amounts of our tax dollas and generating endless pages of red tape in order to not protect inventors and consumers. I think it could potentially cost less and be more streamlined to regulate reasonably than to fight to avoid regulation.